So why do VET FEE-HELP programs cost so much?
June 6, 2014 5 Comments
I have to admit over the past week or so I have had a bit of a dilemma floating around in my head, it start when the changes to VET FEE-HELP were announced in the federal budget and has continued to grow across a number of discussions I have had in various forums and the fact that I am seeing more and more facebook ads for VET FEE-HELP courses. So my question is really quite a simple one.
Why does the cost of a Diploma vary from $4000 to $20,000?
Now let’s be honest here and look at some figures, even at a base price of say $4000 per student, a cohort of 25 students produces a gross income of $100,000, however at $15,000 per student it produces a gross income $375,000. I guess my question here is
does it really cost, even with making a profit, $375,000 to deliver a Diploma to 25 Students.
One of the arguments I have often heard around why some providers charge much higher fees for these programs than others is that their course is the best and provides the best outcomes and is delivered by ‘insert name here’, however these aren’t university courses we are talking about, these are VET, nationally accredited courses, all of which have exactly the same performance criteria and everyone who is deemed competent, whether they have paid $0 or $20,000+ for their Diploma ends up with a piece of paper that says the same thing. It doesn’t matter how much you have paid for your Diploma, the system says they are equal.
The real problem I have with this is that there really is something that is not being made clear here and that is students opting for VET FEE-HELP courses are getting themselves into
and often the students who are taking up this option are the ones who can really least afford it in the long run but who are seduced by slick marketing, new ipads or laptops and promise of never really having to pay it off, well unless you earn over, a dollar amount that could be changed tomorrow and severely affect your ability to pay your bills.
I also know that one of the arguments for the costs associated with the deliver of higher level qualifications is that there is a lot of administration and marketing and other costs involved in the VET FEE-HELP system and that may be true, but even if the delivery of a diploma level program to 25 Students, with everything included (admin, marketing, student toys) was $250,000 ( and I have to say I think I am being really generous here) the gross profit margin is still 33%
I am trying really hard not to think that at least some of the providers out there utilising VET FEE-HELP as a part of their business plans are simply grossly overcharging their students and trying to suck as much money out of the Government and in the long-term the students as they can, but when I think about the figures it really does seem that at least some providers might be.
If anyone has some figures about how much it actually costs for the delivery of Diploma level programs under VET FEE-HELP or a justification for why a Diploma of Counselling and other course should cost a student in excess of $18,000 I would really love to hear them.